Market Report & Analysis for 6/25/2018 Afternoon Edition

by | Jun 22, 2018 | EMI, Fuels & Markets, Industry News

Afternoon Market Overview

The long anticipated OPEC production meeting has occurred and the group agreed OPEC along with allies led by Russia should increase production by about 1 million barrels per day which was within market expectations.
The real increase will be smaller because several countries that currently underproduced versus their quote will struggle to return to full quotas and other producers fail to make up the difference. Verbiage from the official press release follows: The Conference analyzed oil market developments since it last met in Vienna at the end of November and reviewed the oil market outlook for the remainder of 2018.
The Conference noted that the oil market situation has further improved over the past six months, with the global economy remaining strong, oil demand relatively robust, albeit with some uncertainties, and with the market rebalancing evidently continuing. Moreover, the return of more stability and more optimism to the industry has been welcomed by all stakeholders. Reaffirming OPEC’s continued commitment to stable markets, the mutual interest of producing nations, the efficient, economic, and secure supply to consumers, and a fair return on invested capital, and noting the overall improvement in market conditions and sentiment and the return of confidence and investment to the oil industry.
Recalling the 171st OPEC Conference resolution reached on 30 November 2016 for a production adjustment of 1.2 mb/d. Noting that OPEC Member Countries have exceeded the required level of conformity that had reached 152% in May 2018.
Accordingly, the Conference hereby decided that countries will strive to adhere to the overall conformity level of OPEC-12, down to 100%, as of 1 July 2018 for the remaining duration of the above mentioned resolution and for the JMMC to monitor and report back to the President of the Conference.